Thursday, May 2, 2013

Technology supports heart patients at home

EDMONTON, May 2, 2013 /CNW/ - A group of Albertans living with heart failure will have their conditions monitored right from their homes as part of an innovative pilot project. The pilot is a collaboration between the Alberta government, Alberta Health Services and GE Canada.

"We know Albertans want to spend less time in hospital and more time at home with their loved ones. That's why we're investing in initiatives like this, that allow patients to manage chronic conditions from home with the help of health care professionals," said Premier Alison Redford. "Our government is committed to health care innovation to provide better care, better outcomes and better value for Albertans."

The pilot, to be delivered through the Sherwood Park-Strathcona County Primary Care Network, will target about 250 patients over the age of 50 who are living with heart failure. Patients who are enrolled in the pilot will receive in-home technology developed by Intel-GE Care Innovations™ that will collect vital information, engage patients in their own care, and enable a team of health care practitioners to manage the patient care remotely.

"This new technology brings health care right into the home and that takes access and innovation to a whole new level," said Health Minister Fred Horne. "Remote monitoring strengthens links between patients at home and front-line primary care teams."

"This project incorporates innovation and technology to support our goal to improve access for Albertans," said Dr. Chris Eagle, President and CEO of Alberta Health Services. "This has the potential to provide those living with chronic conditions with comprehensive virtual care and also to explore a model of care which may lead to increased capacity in the health care system."

"We are excited to be involved in this pilot project. Our PCN has a history of using innovative technologies to enhance patient care, and we look forward to leveraging the benefits of this technology for our patients," said Dr. Moiz Ramji, Sherwood Park-Strathcona County Primary Care Network.

"This pilot project is an excellent example of how working collaboratively to develop and apply innovative in-home technology has the potential to transform healthcare delivery in Alberta, nationally and globally," said GE Canadapresident and CEO Elyse Allan.

"GE Healthcare strives to be at the forefront of the patient experience. Home health technology paired with our leading IT and consulting solutions will provide a unique GE Healthcare solution to help address cost, quality and access, which are some of Alberta's toughest healthcare challenges," said GE Healthcare Canada Vice-President and General Manager Peter Robertson.

"Transforming healthcare requires user-centered innovation grounded in real changes in business processes and clinical workflows, and we're thrilled to see this happening in the MyHome Health program," said CEO of Intel-GE Care Innovations™ Louis Burns. "Our technology platforms are designed to enable this necessary care transformation, and we're honoured to work with our Canadian partners to deliver more efficient and patient-centric models of care into the home."

The pilot project will accept applications for the program later this month, and after necessary approvals have been obtained. For more information on this program and patient eligibility, please visit www.myhomehealthcanada.com or contact 1-855-413-8770.

Why Healthcare Must Embrace Cloud Computing

Regulatory compliance for the healthcare industry is a hot-button issue. The overriding compliance requirements that this industry faces are dictated by the Health Insurance Portability and Accountability Act (HIPAA), enacted by Congress in 1996. HIPAA was designed to protect the privacy of patients’ medical records and restrict who has access to them.

The latest HIPAA standards surrounding the security and privacy of patient data makes many in the healthcare industry understandably cautious about adopting new technologies. In the past, healthcare companies preferred to keep any electronic data concerning business operations and patient care behind a secure firewall. Now, HIPAA omnibus and the American Recovery and Reinvestment Act (ARRA) requirements stipulate everyone in the healthcare industry begin migrating patient records and other data to cloud computing. Essentially, by 2015, all medical professionals with access to patient records must utilize electronic medical and health records (EMR and EHR), or face penalties.

A recent study by the firm MarketsandMarkets indicates that the healthcare cloud computing market, which is only currently about 4% of the industry, is expected to grow to nearly $5.4 billion by 2017. The cloud migration process, however, can be daunting for healthcare organizations since they have to move a ton of data.

Cloud computing and infrastructure security are continually evolving to meet the growing security requirements of heavily-regulated industries like healthcare. Legitimate cloud service providers have strict security protocols designed to comply with different regulatory mandates, including SEC, Sarbanes-Oxley Act, and HIPAA.

Many cloud service providers have started offering HIPAA-specific compliant solutions. Healthcare service providers should verify that their chosen cloud service provider is HIPAA compliant before signing up for the service. If this information is not provided on the company’s website, call the sales or support line for more information.

Benefits of Cloud Computing for Healthcare Organizations

While privacy concerns have kept many healthcare organizations from migrating to a cloud computing solution, the cloud does offer major benefits to these providers.

Security: Online medical records storage is the main reason for using cloud computing for most healthcare providers. With a recent HIPAA update, cloud service providers are now as liable for HIPAA compliance as the healthcare entities they serve. This includes ensuring that data is encrypted and securely backed up, verifying that data can be easily recovered, and using permission-based data access.

Scalability: Unlike on-site hardware infrastructure, you can easily scale your cloud storage solution to manage ever-growing patient data. Healthcare service providers generally must keep records for at least six years. Considering the volume of patient data, the likelihood of this overwhelming any on-site IT infrastructure is inevitable. The leading providers of cloud computing, cloud server or storage solutions are able to adapt to your EMR/EHR load quickly and store terabytes of your patients’ data in secure, redundant cloud storage.

Mobility: The increasing demand for physicians’ time often means they only have the opportunity to review patient records and tests or do research during evening hours. In the past, this meant being stuck in the office after hours. With cloud computing solutions, patient information is readily available. Now, doctors can quickly and easily pull up medical records remotely. This improves the physician’s ability to provide high-level care to patients. Patients see a reduction in the amount of paperwork that they need to fill out and the time and stress of disputing incorrect bills.

Cost Reduction: By adopting cloud-computing solutions, patients, physician’s practices, and medical organizations experience cost savings. The patient doesn’t have to endure paying for the same test twice when they go to different doctors or specialists or if the test results are lost. Physicians’ medical offices avoid paying for on-site hardware infrastructure and maintenance in order to securely store patient medical records. Add to that the costs of new software and updates to existing software programs and the required on-site IT personnel. Physicians are able to submit prescriptions and refills electronically to pharmacies. Cloud computing also increases the accuracy of reimbursement coding. According to a report[1] by Healthcare Financial Management and depending on the scope and size of a healthcare organization, savings benefits of EMRs/EHRs can amount to upwards of $37 million over a five-year period.

Sharing: Cloud computing solutions keep physicians connected with patients and their colleagues. Referrals to specialists happen in a timelier manner, and healthcare service providers can easily access complete patient history and information online. Again, repeat diagnostic tests are avoided, saving time, money, and patient stress.

Cloud service providers are now offering a variety of new ways to access information via cloud applications and microsites designed for mobile devices. To specifically address the needs of the healthcare industry, cloud service providers continue to improve technology platforms to improve lab order entry, pharmacy records management, medical billing, imaging service requests and more. Cloud companies must start offering HIPAA-compliant solutions if they wish to meet the demands of healthcare service providers that need cloud computing services.

Has your office transitioned to a cloud computing solution yet? If not, will you migrate if your organization is threatened with Affordable Care Act penalties?

The Justice Department filed a lawsuit Thursday against the largest for-profit hospice chain in the United States, charging that the company knowingly submitted false claims to Medicare for services that were not necessary, not actually provided or not performed in accordance with Medicare requirements.

The government’s complaint alleges that Chemed and Vitas Hospice set goals for the number of crisis care days that were to be billed to Medicare and used aggressive marketing tactics and pressured staff to increase the numbers of crisis care claims submitted to Medicare, without regard to whether the services were appropriate or were actually being provided.

The complaint contends that Vitas billed three straight days of crisis care for one patient, even though the patient’s medical records do not indicate the patient required crisis care and show that the patient was playing bingo part of the time.

In addition, the complaint alleges that Chemed and Vitas knowingly submitted or caused the submission of false claims for hospice care for patients who were not terminally ill. The companies allegedly paid bonuses to staff based on the number of patients enrolled in the program and based on patients who were admitted for longer lengths of stay, and took adverse employment actions against marketing representatives who did not meet monthly hospice admissions goals.

According to the complaint, these business practices resulted in the admission of patients who were not eligible for hospice care. The complaint alleges that Vitas admitted a patient to hospice who showed no signs of a terminal condition and was described in Vitas‘ own records as, “very healthy given her age.”

“The Medicare hospice benefit is intended to provide patients nearing the end of life with pain management and other palliative care to make them as comfortable as possible,” said Acting Assistant Attorney General Stuart F. Delery, who heads the Justice Department’s Civil Division.

“Too often, however, we hear reports of companies that abuse this critical service by using aggressive marketing tactics to push patients into services they don’t need in order to get higher reimbursements from the government,” he said.

The Medicare hospice benefit is available for patients who elect palliative treatment for a terminal illness, and have a life expectancy of six months or less if their disease runs its normal course. When a Medicare patient receives hospice services, he or she no longer receives services designed to cure his or her illness.

The lawsuit is part of the government’s emphasis on combating health care fraud through its Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric H. Holder Jr. and Kathleen Sebelius, secretary of the Department of Health and Human Services, in May 2009.

$63 Million Verdict for Mental Health, False Claims Scheme

The Department of Justice reported yesterday that the supervisor of a $63 million health care fraud scheme has been convicted. 51-year-old Wondera Eason, supervisor of a Miami-area mental health care company, Health Care Solutions Network (HCSN), was found guilty of conspiracy to commit health care fraud. She was employed as Director of Medical records at HCSN’s Partial Hospitalization Program (PHP), an intensive treatment facility for patients with severe mental illness.

Eason, a certified medical records technician, oversaw the “alteration, fabrication, and forgery of thousands of documents, which purported to support the fraudulent claims HCSN submitted to Medicare and Florida Medicaid.” She reportedly directed therapists to fabricate documents as well, and provided Medicare and Medicaid auditors with fraudulent documents, which she certified were accurate.

Oftentimes, HCSN “therapy” consisted of “nothing more than patients watching Disney movies, playing bingo, and having barbeques.” Eason purportedly told therapists to eliminate any references to these activities from their medical records.

Evidence at trial showed that HCSN paid illegal kickbacks to owners and operators of Miami-Dade County Assisted Living Facilities (ALF) in exchange for patient referral information, which was used to submit fraudulent claims to Medicare and Medicaid. It was found that HCSN billed an estimated $63 million to Florida Medicare and Medicaid from 2004 to 2011.

The previous owner of HCSN, which operated in two locations in Florida, opened a third facility in Hendersonville, North Carolina after stealing millions from Medicare and Medicaid in Florida. In February, Armando Gonzalez pled guilty to health care fraud and money laundering charges, and was sentenced to fourteen years in prison plus three years supervised release, and ordered to pay $28,092,283 in restitution.

Humana 1Q profit soars, insurer's forecast rises

The Louisville, Ky., company also hiked its 2013 earnings forecast well above expectations, and its shares soared more than 4 percent in morning trading. But Humana also said earnings growth next year is uncertain due to funding cuts for Medicare Advantage plans, which bring in more than 60 percent of its revenue.

Humana Inc. is the second-largest provider of Medicare Advantage plans, which are privately run versions of the government's Medicare program for the elderly and disabled people. The insurer trails only UnitedHealth Group Inc. in enrollment.

Shares of Humana and other insurers that provide Medicare Advantage coverage slid in February after the Centers for Medicare and Medicaid Services released data that pointed to payment cuts as steep as 8 percent for next year.

The government then softened the blow to a reduction of around 4 percent, according to some estimates. But UnitedHealth said last month that cut will still be tough to stomach, given rising medical costs and other funding reductions that could hit the program next year.

Insurers offer hundreds of different Medicare Advantage plans around the country, and some have said they may have to cut benefits, raise the premiums customers pay or leave markets entirely to earn adequate profits.

"On the immediate horizon, while the final 2014 Medicare rate notice remedied some aspects of the major reduction that was initially proposed, funding challenges continue, making 2014 earnings growth uncertain at this time," Humana CEO Bruce D. Broussard said in a statement from the company.

Analysts have said Humana's Medicare Advantage membership is skewed toward preferred provider organization coverage, which can yield thinner profit margins than health maintenance organizations. That makes them more vulnerable to funding cuts.

Humana and its competitors usually provide specific earnings forecasts for the next year in the fourth quarter.

For the first quarter, Humana earned $473 million, or $2.95 per share. That compares with $248 million, or $1.49 per share, in last year's quarter.

Total revenue climbed nearly 3 percent to $10.49 billion.

Analysts expected, on average, earnings of $1.80 per share on $10.24 billion in revenue, according to FactSet.

Humana said a litigation settlement and a delay in the implementation of federal spending cuts added about $66 million before taxes to its performance in the quarter, or 26 cents to earnings per share.

The insurer said enrollment in individual Medicare Advantage plans climbed nearly 7 percent to more than 2 million people, which helped premium and service revenue increase.

Enrollment jumped more than 15 percent to 412,800 in employer-sponsored, group Medicare Advantage plans for which Humana provides insurance and doesn't just administer the policies. These fully insured plans are generally more profitable for insurers.

Total Medicare premiums climbed more than 12 percent to $7.69 billion.

Humana said it now expects 2013 earnings to range between $8.40 and $8.60 per share, up from its previous forecast for $7.60 to $7.80 per share.

Analysts expect, on average, earnings of $7.92 per share.

Humana shares traded at $77.55, up $3.44, or 4.6 percent, in early trading.

Feds File Two False Claims Act Lawsuits Against Novartis

For the second time in a week, federal officials have filed a False Claims Act lawsuit against Novartis.

The second lawsuit, filed late last week, alleges that the pharmaceutical giant paid kickbacks to doctors to induce them to prescribe Novartis pharmaceutical products that were reimbursed by federal health care programs.

The lawsuit alleges that as a result of Novartis’s unlawful conduct, the federal government paid false claims for reimbursement for Novartis pharmaceutical products.

“Novartis corrupted the prescription drug dispensing process with multi-million dollar ‘incentive programs’ that targeted doctors who, in exchange for illegal kickbacks, steered patients toward its drugs,” said U.S. Attorney Preet Bharara. “And for its investment, Novartis reaped dramatically increased profits on these drugs, and Medicare, Medicaid, and other federal healthcare programs were left holding the bag, doling out millions of dollars in kickback-tainted claims.”

“Healthcare fraud imposes tremendous costs and causes great harm to an already burdened healthcare system, and the government will not tolerate it. The widespread kickback fraud alleged in our two lawsuits against Novartis – which only a few years ago settled a False Claims Act case involving violations of the Anti-Kickback Statute based on illegal payments to doctors – makes us question whether Novartis is getting the message.”

Novartis, a pharmaceutical company headquartered in East Hanover, New Jersey, is a subsidiary of Novartis AG, an international pharmaceutical company headquartered in Basel, Switzerland.

Federal officials alleged that Novartis systematically violated the anti-kickback law, which prohibits the payment of remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally-funded programs.

Federal officials alleged that Novartis violated its own internal policies concerning speaker programs, which require that the programs have an educational purpose and that slides about the company’s drugs be presented.

Novartis violated the the anti-kickback law, the feds alleged, by paying doctors to speak about certain drugs, including its hypertension drugs Lotrel and Valturna and its diabetes drug Starlix, at events that were often little or nothing more than social occasions for the doctors.

The payments and lavish dinners given to the doctors were, in reality, kickbacks to the speakers and attendees to induce them to write prescriptions for Novartis drugs.

In many instances Novartis made payments to doctors for purported speaker programs that either did not occur at all or that had few or no attendees, and thousands of programs were held all over the country at which few or no slides were shown and the doctors who participated spent little or no time discussing the drug at issue.

Many speaker programs were also held in circumstances in which it would have been virtually impossible for any presentation to be made, such as on fishing trips off the Florida coast. No slides were shown on the boat.

Other Novartis events were held at Hooters restaurants.

In connection with these programs, Novartis also frequently treated the doctors to expensive dinners that they hosted at high-end restaurants.

For example, a July 5 dinner for three, including the speaker, at a Washington, D.C. restaurant cost $2,016, or $672 per person.

Novartis also paid a $1,000 honorarium to the speaker for this program.

One of the two attendees had attended the same program a short time earlier. At another program held on Valentine’s Day in 2006, Novartis paid $3,127, for a meal for three people at a West Des Moines, Iowa restaurant, or $1,042 per person.

Novartis’s internal analyses show that speaker programs had a high return on investment in terms of the additional prescriptions for its drugs written by the doctors who participated in the programs, both as speakers and attendees, with the highest return arising from payments to doctors as “honoraria” for speaking. In short, doctors increased the number of prescriptions they wrote when they were being paid by Novartis to speak about a drug.

As a result, Novartis spent millions on speaker programs yearly.

According to Novartis’s data, during the period from January 2002 through November 2011 it spent nearly $65 million and conducted more than 38,000 speaker programs for just three drugs: the hypertension drugs, Lotrel and Valturna, and the diabetes drug, Starlix.

In the absence of a legitimate purpose for many of the programs, the payments were nothing more than kickbacks to the doctors that induced them to write prescriptions in violation of the anti kickback law..

Federal officials said that Novartis was well aware that its speaker programs created opportunities to provide kickbacks to doctors.

In September 2010, Novartis entered into a settlement with the U.S. Department of Justice to settle False Claims Act lawsuits based in part on violations of the AKS due to illegal remuneration paid to doctors through such mechanisms as speaker programs, and signed a Corporate Integrity Agreement (“CIA”) with the U.S. Department of Health and Human Services Office of Inspector General agreeing to implement a rigorous compliance program.

Even after entering into the CIA, Novartis’s compliance program was inadequate to prevent kickbacks from being paid in conjunction with Novartis’s speaker programs.

Novartis did not adequately review its speaker program to determine whether the programs were being used for an illegitimate purpose. Furthermore, although many instances of speaker program abuse were reported to Novartis, sanctions were generally mere slaps on the wrist.

In some cases, sales representatives who violated Novartis’s own speaker program policies were nevertheless promoted.

Even after September 2010, Novartis continued to conduct bogus speaker programs that were simply vehicles for paying kickbacks to doctors in the form of honoraria and expensive meals.

Statement From John Gorman, Executive Chairman, Gorman Health Group Regarding the Final 2014 Rates for Medicare Advantage

WASHINGTON, DC--(Marketwired - April 02, 2013) - The following is a statement from John Gorman, Executive Chairman, Gorman Health Group:

"The last 45 days for Medicare Advantage (MA) stakeholders have been like watching an asteroid on a collision course with Earth, only to be averted at the last second. With the proposed rates representing the deepest cuts to MA in the history of the program, this was nothing less than doom diverted, a stunning reversal from the Centers for Medicare and Medicaid Services (CMS). It was a rare bipartisan coalition of over 160 Members of Congress whose lobbying power brought April flowers. Tea Partiers and the Chairman of the Congressional Progressive Caucus alike came together to get this result. Democrats, in particular, seem to have awakened to the constituency MA serves: largely lower-income minorities in greatest need of coordinated care. In response, the Department of Health and Human Services (HHS) and the White House overruled the CMS actuaries to get over 550 basis points' improvement in the final rates. It shows the new political juice MA has acquired, now serving almost 30% of Medicare beneficiaries, who overwhelmingly love it.

"The new trends for 2014 are POSITIVE 2.96% for MA rates calculated under the old law, and 3.53% for MA rates calculated under the Affordable Care Act (ACA). About half of all US counties are still getting a blend of these two rates, while the remaining counties are fully on the new ACA rates. Overall, the average increase will be around 3.3% - 3.4%, versus the 2.2% cut proposed in the advance notice.

Blending and Rebasing

"CMS rebased the county Fee For Service (FFS) costs again. This will move some counties from one quartile to another, giving some counties bigger increases, or actual decreases, based solely on the effect of rebasing. Since the impact is phased in over two years, a number of in-between quartiles develop. In theory, a county's ACA rate can be any of 24 different blends of 2012, 2013 and 2014 quartiles. In 2014 counties will be arrayed across nine different 'quartiles,' reflecting the effect of the blending due to quartile changes.

"It appears that the quartile turmoil is less this time than with the 2013 rebasing. While 27% of all counties changed quartiles with the 2013 rebasing, only 13% are changing quartiles this time.

"Rebasing can also affect whether a county qualifies for a double bonus under the quality bonus system, since one of the criteria is a county FFS cost figure that is below the national average. In 2013, four counties gained double bonus status, and seven lost it. In 2014, eighteen counties will gain double bonus status, among which are three counties regaining the double bonus after losing it in 2013. Only two counties will lose double bonus status in 2014. Plans that qualify for quality bonus payments will see those payments increase or decrease by 5% for members who live in counties gaining or losing double bonus status. This adds yet another unpredictable variable to revenue planning.

"In a change in methodology, CMS used current wage index and physician cost index data to recalculate the historical claims used in rebasing, to express FFS costs at current Medicare allowable amounts. Previously they took prior year claims as paid. This adds accuracy to the rebasing calculation, but it adds more uncertainty to rebasing for 2014. For 2014 only, CMS is blending the new calculations with the old method of not adjusting for changes in indices. The blend is 50/50, for 2014 only. This adds yet one more variable to the payment calculation process, and also strongly implies that CMS will rebase again in 2015, again moving counties among quartiles. This potential for movement among quartiles, based on FFS cost patterns outside the control of MA plans, makes long range planning difficult. Rates can vary by 5% or more from where a plan expects them to be, based on where CMS rebasing calculations peg a plan's counties' FFS costs relative to all other US counties."

Risk Adjustment Reprieve

"The MA industry dodged a bullet on risk adjustment in particular. CMS is implementing new Hierarchical Condition Categories (HCC) risk adjustment coefficients for 2014. CMS say that the new codes will result in lower risk scores than the old coefficients, given the same mix of diagnoses. The impact is projected to be approximately a 2.6% reduction in scores, on average. The actual impact on individual plans will depend on the diagnostic profile of their members. CMS have abandoned the idea proposed in the advance notice, to hold plans harmless from the impact of the change in 2014 by adjusting the denominator used in the calculations. Instead they are blending the old rates with the new ones, at 25% old and 75% new. This implies that 75% of the reduction, or about 1.95%, will be felt in 2014, while the entire 2.6% will affect 2015 risk scores. This will offset the positive impact of the rate trends, and places even more weight on plans to diligently discover, document, and report all relevant diagnoses.

"Because CMS is blending 2013 and 2014 risk scores, they have calculated two different FFS normalization scores. The FFS normalization is necessary to shift the mid-point of the HCC score structure so that it averages out to exactly 1.00 when applied to a sample of FFS claims. This isn't an adjustment for MA coding, but for changes in FFS coding over time. The two normalization factors will be blended, too. The FFS normalization scores are:

Applicable to the 2013 HCCs (25%) = 1.041

Applicable to the 2014 HCCs (75%) = 1.026

"Average" = 1.0298

This compares with the single normalization factor in the advance notice, of 1.026.

"The coding intensity adjustment, which takes back money to compensate for the fact that plans keep getting better at risk coding, goes up by 1.5 percentage points in 2014, from 3.41% to 4.91%. This is mandated by law, and is no surprise. This will be an added reduction in revenue, based on the assumption that plans are continually improving their ability to report diagnoses, and it is incumbent on plans to live up to that expectation, or suffer erosion of income.

"CMS is putting off for a year any attempt to address how diagnoses that are documented in health risk assessments (HRAs) affect risk adjustment. They were going to require plans to flag all diagnoses discovered in HRAs during 2013. CMS proposed to disallow codes from HRAs in future years unless they were substantiated by another clinical encounter. The difficulty is that they have not yet developed a concrete definition of an HRA, as distinct from a routine checkup. This idea isn't dead, and we expect CMS to find some way to ascertain whether data from HRAs represent actual risk. Plans must use HRAs as a mechanism to identify and manage patients at risk, with a clear handoff of HRA data to care management programs. Documentation of diseases that map to HCCs is a valuable by-product of HRAs, but should not overtake the significance of the clinical purpose of prospective exams.

"CMS has relented somewhat on the total beneficiary cost (TBC) limit, compared to the advance notice, and it's a much lesser issue with some restoration of the rates. The TBC is the maximum amount by which CMS will allow plans to increase the combination of premiums and cost sharing, using the CMS estimate of the Per Member Per Month (PMPM) cost of any cost sharing changes. They were proposing to reduce the maximum TBC change from $36 to $30 per member-month. Now they are only reducing it to $34. Also, the TBC is adjusted for the impact of benchmark reductions caused by phase-in of the new ACA rates, including changes in quartiles, and gaining or losing double-bonus status.

"While this final notice was good news across the board, we still must recognize that, all in, we're still looking at a cut in rates in 2014 after the impact of the ACA is considered. It's just less severe than what was proposed. We'll likely see cuts like these again in 2015 and beyond. And while the Administration has shown here that they have no interest in market disruption, their knives are still out on the basis of plan performance.

"These are just the beginning of austerity measures, and MA will only get harder to manage profitably over time. Forward-looking plans will use this stay of execution to drive needed change within their companies more urgently."

If you have additional questions or would like to schedule an interview with one of Gorman Health Group's subject matter experts, please contact Kristin Rodriguez: 510-244-7114, or krodriguez@gormanhealthgroup.com.

Serge Sivchuk, 27, owner of Advantage Medical Transport, Inc. in Harrisburg pleaded guilty Wednesday on 14 counts of false statements in health care matters for reporting fake Medicare claims, according to the U.S. Attorney's Office for the Middle District of Pennsylvania.

The indictment states that between January 2009 and June 2011, Sivchuk and Advantage submitted hundreds of claims for the non-emergency transportation of Medicare beneficiaries. The patients were ambulatory and the ambulance transports were not necessary, officials said.

David Paul of York, who worked as an EMT and company dispatcher, also was charged with conspiracy and 14 counts of false statements in health care matters. Paul pleaded guilty August 22, 2012 and was sentenced on Dec. 19 to two years probation. Paul also was ordered to pay $2,939.27 in restitution.

The total loss to Medicare was $740,000, officials said. Sivchuk is awaiting sentencing and the completion of a pre-sentence report.

SAC Capital Advisors LP and Viking Global Investors LP are being questioned by SenatorCharles Grassley in his review of a possible leak of a U.S. government decision on payment reimbursements to health insurers.

Grassley, an Iowa Republican, sent letters yesterday to the investment firms, asking about their dealings with “political intelligence” firms that try to predict government decisions. A Height Analytics LLC report on April 1 told clients more than 40 minutes before the official announcement that the U.S. would reverse plans for a Medicare Advantage rate cut.

Shares of Humana Inc. (HUM), UnitedHealth Group Inc. (UNH) and other insurers soared after the report. Trades by Andreas Halvorsen’s Viking hedge fund company and Steven A. Cohen’s SAC “raise questions regarding the transmission of political intelligence from Washington, D.C. to Wall Street,” Grassley said in his letter. He cited a Wall Street Journal report that the two firms traded in health stocks before the Medicare decision.

Eric Komitee, general counsel for New York-based Viking, said he couldn’t confirm the trades and declined to comment on Grassley’s letter. Jonathan Gasthalter, a spokesman for Stamford, Connecticut-based SAC, also declined to comment.

Justin Simon, an analyst at Height Analytics in Washington, sent a note to clients about 20 minutes before the market close on April 1 that said “a deal has been hatched to protect Medicare Advantage rates.” Companies including Humana and UnitedHealth offer the plans as an alternative to the government-run Medicare program for the elderly and disabled.

‘Credible Sources’

Simon made his call after reviewing other reports on the topic and talking with lobbyists working on the issue. One of those lobbyists, former Grassley aide Mark Hayes of the firm Greenberg Traurig LLP in Washington, told Simon that “very credible sources” had said the government would reduce the payment cut, according to e-mails obtained by Bloomberg.

Humana, which gets more of its revenue from Medicare than any other insurer, jumped about 8.6 percent after Simon’s note was issued. Hayes’s clients included Humana, which severed its relationship with Greenberg after Grassley began his probe.

Grassley hasn’t found that Hayes or Simon received advance notice of the decision from government officials. Both Greenberg and Height have said their employees did nothing wrong. Height terminated a contract with Greenberg for Hayes to advise its analysts on April 19, after Humana fired the firm.

Greenberg said April 22 it would no longer represent “political intelligence” firms.

SAC, Viking Questioned in Grassley’s Medicare Rate Probe

By Alex Wayne - May 1, 2013 11:52 AM ET

Decision Date

The U.S. Centers for Medicare and Medicaid Services, the agency that runs Medicare, and the inspector general for the Health and Human Services Department are also investigating whether there was a leak of the Advantage decision. Spokesmen for the two agencies didn’t immediately respond to e-mails today asking about the status of their investigations.

Medicare officials decided two weeks before the official announcement that they would change a key calculation that helps determine Advantage rates, according to Grassley.

SAC, which oversees $15 billion in assets, reached a $602 million conditional settlement last month with the U.S. Securities and Exchange Commission of claims the firm and one of its units profited from illegal tips about a drugmaker received by former portfolio manager Mathew Martoma. That case is unrelated to the Medicare Advantage review Grassley is conducting.